The company has seen its revenues grow significantly since the beginning of last year, but it is still lossmaking.
Language learning app Duolingo has filed for its initial public offering as both its revenues and losses continue to grow.
The Pittsburgh-headquartered company, which was last valued at $2.4bn, is expected to go public on the Nasdaq in the third quarter of this year and could raise around $100m.
Over the last year and a half, it has seen its revenue grow as more people flock to the app to learn a language. But the company is still lossmaking, according to papers filed ahead of the IPO.
For 2020, it booked $161.7m in revenue, an increase of more than 128pc year on year, with net losses of $15.7m
In the first quarter of 2021, it brought in $55.3m in revenue with $13.4m in net losses, a considerable increase on the $2.2m in losses in the first quarter of 2020.
Duolingo generates revenue through subscription services. It offers free courses in 38 different languages, including in some rarer and endangered tongues, with a premium tier for additional features to help people learn and track their progress.
It also offers an English test service that is accepted by 2,000 universities and educational bodies.
Duolingo said it relies on Apple’s App Store and the Google Play Store in order to reach users. The business practices of these stores, specifically in the case of Apple, has come under the microscope in legal cases of late.
“If we are unable to maintain a good relationship with such platform providers,” Duolingo wrote in its filing, “if their terms and conditions or pricing changed to our detriment, if we violate, or if a platform provider believes that we have violated, the terms and conditions of its platform, or if any of these platforms loses market share or falls out of favour or is unavailable for a prolonged period of time, our business will suffer.”
The filing added that the company is interested in acquisitions to bolster its growth trajectory as well as to acquire competencies in other language learning tech. The company has avoided M&A activity to date.
Duolingo has raised more than $180m from investors including Kleiner Perkins, Union Square Ventures and Google’s CapitalG.